The Australian dollar is higher as improved confidence in the US economy gives riskier assets a boost.
At 1200 AEDT on Monday, the local unit was trading at 90.45 US cents, up from 89.92 cents on Friday.
Market sentiment was not hurt by weak January US industrial output figures, released on Friday, due to the impact of disastrous weather, Westpac chief currency strategist Robert Rennie said.
"The extreme cold and the harmful weather in the US though January and February seemed to have had greater impact on economic data than most economists had thought," he said.
"That leads you to think we may see a slower pace of tapering, that then helps risk sentiment and the US dollar trading on the back foot, that continued to benefit the Australian dollar over the weekend."
Mr Rennie expects the Australian dollar to keep gaining ground ahead of and after the release of the minutes of the Reserve Bank of Australia's February board meeting on Tuesday.
"At some point over the next couple of days it will test 91 US cents more on the basis of market sentiment," he said.
"It's been mid January since it was above 90.80 US cents."
Meanwhile, the Australian bond market was weaker.
At 1200 AEDT on Monday, the March 2014 10-year bond futures contract was trading at 95.910 (implying a yield of 4.090 per cent), down from 95.945 (4.055 per cent) on Friday.
The March 2014 three-year bond futures contract was at 96.990 (3.010 per cent), down from 97.020 (2.980 per cent).